Overstock’s Strategy and Segmentation Insights Drive Customer Value Alignment


In the ever-evolving world of retail, understanding and aligning with customer value has become paramount for businesses to thrive.

Overstock, the renowned retailer, stood out as an example of a company that has successfully leveraged segmentation to rise above the competition and create a loyal customer base.

Overstock’s strategy links back to the customer value gap and illustrates the importance of segmenting clients and understanding the competitive landscape.

Pinpointing the Types of Customers

To effectively align with customer value, it is crucial to identify the different types of customers and their preferences. Under CEO Jonathan Johnson’s guidance, Overstock embarked on a journey to pinpoint the customer profiles that would resonate with their new e-commerce vision. Some essential customer segments they identified include:

  • The “Savvy Shopper”: Customers who actively seek out the best deals and value for their money,
  • The “Reluctant Refresher”: Individuals who are hesitant to update their furniture but will make a purchase with the correct value proposition,
  • Bed Bath and Beyond Customers: Overstock strategically targeted customers already shopping at Bed Bath and Beyond, aiming to offer them better value and options.

Overstock positioned itself as a “High-Low” retailer that offers high-quality products at affordable prices, catering to customers who desire both style and affordability.

Understanding the Customer Value Gap

Businesses must bridge the customer value gap to stay relevant. This gap exists between what customers perceive as valuable and the products, services, and experiences companies invest in.

Overstock’s success lies in its ability to bridge this gap by offering exceptional prices and deals that resonate with customers’ value expectations.

By understanding what customers truly want, businesses can tailor their offerings to meet those needs.

Understanding the Competitive Landscape

Segmenting clients allows businesses to tailor their marketing strategies and offerings to specific customer groups. As mentioned, Overstock’s strategy targeted Bed Bath and Beyond customers, a particular segment with similar preferences and behaviors.

By understanding its target customers and their competitive landscape, Overstock was able to position itself as a viable alternative and deliver the value that customers were seeking.

Aligning with customer value is a game-changer in today’s competitive retail landscape.

Overstock’s transformation from Overstock Liquidator to a furniture retailer exemplifies the power of understanding customer preferences, segmenting clients, and delivering exceptional value.

Businesses can create long-lasting relationships and drive customer loyalty by identifying customer segments and closing the customer value gap.

Embrace the era of customer value alignment, and let it shape the core of your business strategy for success in the modern market.

📚 Learn more about how Overstock grew their business through strategic segmentation.

💡 Discover other examples of customer value-aligned companies.


Jeremie Gluckman

Jeremie Gluckman

Jeremie Gluckman oversees the Worthix community and events programs. Dedicated to delivering customer value, Jeremie is committed to harnessing the power of cutting-edge technology to foster profound human connections. With a global reach, Jeremie has crafted and cultivated invaluable community engagement initiatives for esteemed organizations such as Amplitude, WeVideo, Accela, Singularity University, IDEO, and the Peace Corps. They're an expert in values-based leadership, design thinking, and the art of building authentic relationships.



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